Lawrence Barcella, a former
prosecutor under fire for a false affidavit used to convict ex-CIA
officer Edwin Wilson on terrorism charges, took part in what appears to
be another national security cover-up  of evidence that Republicans
sabotaged President Jimmy Carters hostage negotiations with Iran in
1980.

Two
years ago, Wilsons 1983 conviction for selling weapons and explosives
to Libya
was thrown out by an outraged federal judge after he learned that a
government
affidavit  denying that Wilson was in contact with the CIA  was a lie.
Wilson, who is now out of prison, has filed complaints against Barcella
with the District of Columbia Bar Association, according to ABC News
Nightline, which interviewed Wilson for a story that aired on April 27.

Barcella
denied wrongdoing in connection with the bogus Wilson affidavit, which
concealed about 80 contacts between Wilson and the CIA during the time
period when Wilson was selling materiel to Moammar Khadafys Libya, then
considered a chief sponsor of international terrorism.

But
Barcella also appears to have withheld evidence in another national
security investigation of the so-called October Surprise case,
allegations that the Reagan-Bush campaign interfered with President
Carters efforts to free 52 American hostages before the pivotal 1980
election. In 1992-93, Barcella headed a House task force which
investigated the accusations and exonerated the Republicans.

Accepted
Wisdom

The
House task force report debunking the October Surprise allegations was
accepted by Official Washington as the final word on the controversy.
But subsequent discoveries have shown that the Barcella-led task force
hid substantial evidence pointing toward Republican guilt as well as the
involvement of some Barcella associates in the scandal.

In an
interview for my book,
Secrecy & Privilege, Barcella acknowledged that some evidence
was kept from the public and that the task forces exculpatory findings
were issued despite the late arrival of incriminating evidence that was
not fully evaluated.

One of
the hidden pieces of evidence supporting the October Surprise
allegations was a 1993 report produced by the Russian government about
its intelligence information on the 1980 hostage crisis. The Russian
report stated that then-vice presidential candidate George H.W. Bush and
other Republicans met secretly with Iranian representatives in Europe,
as several October Surprise witnesses had alleged.

The
Russian report, which was classified as confidential by President
George H.W. Bushs administration during its final 10 days in office,
was never officially released to the American people. I found a copy in
House task force files that had been boxed away in a Capitol Hill
storage room.

We got
the stuff from the Russians just a few days before the House task force
report was set for release on Jan. 13, 1993, Barcella told me. Since the
task forces official mandate had expired on Jan. 3, 1993, about a week
earlier, Barcella said the task force felt there was nothing that could
be done with the Russian material.

We
werent going to be able to look into it, whether it was new
information, disinformation or whatever it was, Barcella said.

When I
asked why the House task force didnt just release the Russian report
and let the public decide about its merits, Barcella cited its
classification as precluding its disclosure. No effort was made to
declassify the Russian report either then or later, nor were any public
references made to this evidence that contradicted the House findings. [For details on the
Russian report, click
here.]

Raiders of the Lost Ark

Barcella
said he envisioned the Russian report and other unreleased task force
material disappearing into some vast warehouse,
like in the movie
Raiders of the Lost Ark.

In
reality, the boxes were moved to an obscure office off the RayburnHouseOffice
Buildings garage and stacked up in an abandoned Ladies Room, where I
found them in late 1994. Over the past several weeks, we have been
posting some of the documents on the Internet at Consortiumnews.com.

In the
interview, Barcella told me that he urged Rep. Lee Hamilton, D-Ind., the
House task force chairman, to extend the October Surprise investigation
for a few more months because new evidence kept arriving in late 1992,
but that Hamilton refused.

Instead
of reflecting that uncertainty, however, the task forces report
categorically rejected the October Surprise allegations and portrayed
the accusers as liars. Some witnesses, including former Israeli
intelligence officer Ari Ben-Menashe, were referred to the Justice
Department for perjury prosecutions. The referrals were leaked to the
press, but no charges were ever filed.

When I recently asked Ben-Menashe about his opinion
of Barcella, the former Israeli intelligence officer answered
sarcastically, Barcella
ought to be on the [U.S.] Supreme Court. He's proven himself to be a
very reliable guy.

Since
1993, some key elements of the House task force report  particularly
its
complicated alibis on the whereabouts of Ronald Reagans campaign chief
William Casey  have collapsed under scrutiny. But the reports
contemptuous tone effectively has prevented a reopening of the historical
mystery.

One
reason the task forces findings were so widely accepted was Barcellas
reputation as the tough federal prosecutor who brought renegade CIA
officer Edwin Wilson to justice in the early 1980s.

Barcellas role in the Wilson case was lionized by author Peter Maas in
the 1986 book, Manhunt, which recounted how Barcella masterminded
Wilsons capture by luring Wilson out of hiding, to the Dominican
Republic, where he was snatched and hustled to the United States for trial.

Barcella
capitalized on his reputation in the Wilson case to land the job as
chief counsel of the October Surprise task force after the House agreed
in 1991 to investigate the longstanding suspicions of Republican
interference in Carters Iran hostage negotiations.

According to more than two dozen witnesses, including Iranian officials
and international intelligence operatives, Republicans held secret
meetings with Iranian emissaries behind Carters back. Some witnesses
claimed that the Reagan-Bush goal was to thwart a pre-election hostage
release, the so-called October Surprise.

As it
turned out, Carter did fail to secure the hostages freedom before the
election and national anger over the humiliation gave momentum to
Reagans landslide victory. The hostages were ultimately freed on Jan.
20, 1981, immediately after Reagan was sworn in.

Though
some Carter administration officials found the timing suspicious,
questions about the hostage release disappeared until the mid-1980s when
the Iran-Contra scandal broke, with disclosures that the Reagan-Bush
administration had engaged in other secret arms-for-hostage negotiations
with Iran in 1985-86.

As more
Iran-Contra secrets spilled out in 1987, evidence emerged showing that
the Reagan-Bush team had winked at third-country shipments of U.S.
armaments to Iran as early as 1981. Some Iran-Contra witnesses began
alleging that those shipments were part of a payoff by the Republicans
for Irans
secret cooperation during the 1980 campaign.

Fierce Counterattack

The
allegations prompted a fierce counterattack by Reagan-Bush loyalists who
saw the allegations as a challenge to the legitimacy of the eras
Republican rule.

Plus, by
1991, when the House agreed to investigate, President George H.W. Bush
was the triumphant leader in the Persian Gulf War and many influential
people in Washington regarded the Iran-Contra scandal  and any side
issues  as unworthy of further national attention.

Barcella
stepped forward as one of the first applicants seeking the job of chief
counsel for the October Surprise task force. On the surface, he appeared
to be a reasonable choice, largely because of his prosecutorial
experience in the Wilson case.

But
today even that victory has lost its shine with the discovery that
Wilsons conviction hinged on a U.S. government lie. The false
affidavit, which rejected Wilsons claim that he had been cooperating with the CIA, was read twice
to the jury before it returned the guilty verdict in 1983.

Jury
foreman Wally Sisk told Nightline that without the governments
affidavit, the jury would not have convicted Wilson.
That would have taken away the whole case of the prosecution, Sisk
said.

The
discovery of this prosecutorial abuse  after Wilson had been imprisoned
for two decades  led U.S. District Judge Lynn N. Hughes in 2003 to
vacate Wilsons conviction for selling military items to Libya. Hughes
said overturning the conviction was justified because the prosecutors
submitted the false affidavit and failed to correct it.

There
were, in fact, over 80 contacts, including actions parallel to those in
the charges, Hughes wrote in his decision. The government discussed
among dozens of its officials and lawyers whether to correct the
testimony. No correction was made, until Wilson managed to pry loose an internal memo describing the false
affidavit and revealing the internal government debate about whether to
correct it.

In an
interview with Nightline, Wilson called Barcella and another prosecutor evil for their role in
the deception. Once they got me convicted, then they had to cover this
thing up constantly, Wilson said. They wanted to make sure that I would never get out of
prison.

Barcella,
who was the supervising prosecutor in the case, has said he doesnt
recall seeing the affidavit before it was introduced and has denied any
impropriety afterwards, when other government officials challenged the
affidavits accuracy.

Back-Scratching

Barcella
emerged from Wilsons conviction as a star Washington lawyer with a
sterling reputation. But there soon were signs that Barcella was someone
who tolerated the back-scratching ways of Washington.

According to Maass Manhunt, prosecutor Barcella entertained a
nighttime visit in 1982 from Michael Ledeen, a neoconservative writer
who then was working as a State Department consultant on terrorism.
Ledeen and Barcella were personal friends. Barcella had sold Ledeen a
house and the two aspiring Washington professionals shared a
housekeeper.

That
evening, Ledeen was concerned because two of his associates, legendary
CIA officer Ted Shackley and Pentagon official Erich von Marbod, had
come under suspicion in the Wilson case.

I told
Larry that I cant imagine that Shackley [or von Marbod] would be
involved in what you are investigating, Ledeen told me. I wasnt
trying to influence what he [Barcella] was doing. This is a community in
which people help friends understand things.

Barcella
also saw nothing wrong with the out-of-channel approach.

He
wasnt telling me to back off, Barcella told me. He just wanted to add
his two-cents worth. Barcella said the approach was appropriate because
Ledeen wasnt asking me to do something or not do something. Later,
Shackley and von Marbod were dropped from the Wilson investigation.

In the
context of Barcellas later role in the October Surprise case, however,
the Ledeen connection raised other conflict-of-interest questions. The
House task force staff discovered that Barcellas friend, Ledeen, was
considered an informal member of the Reagan-Bush campaigns October
Surprise Group, which supposedly monitored Carters hostage
negotiations and plotted Republican counter-strategies.

Ledeen
also had other connections to the October Surprise case, including work
that Ledeen and Shackley had done for the Italian intelligence service
SISMI in 1980. At the time, Shackley, who had quit the CIA, also was
serving as an emissary for then-vice presidential nominee George H.W.
Bush on the Iran hostage issue.

[For
more on Shackleys role in the October Surprise case, see Parrys
Secrecy & Privilege. For documentary evidence on Shackleys work
with Bush on the October Surprise issue, click
here.]

Deletions

In the
October Surprise files, I discovered a secret draft copy of the House
task force report that differed significantly from what was issued
publicly. For instance, the final report deleted the names of six
informal members of the Reagan-Bush campaigns October Surprise Group.
They were Michael Ledeen, Richard Stillwell, William Middendorf, Richard
Perle, General Louis Walt and Admiral James Holloway.

In other
words, the reference to Barcellas friend, Ledeen, disappeared from the
final report, much the way Ledeens friends, Shackley and von Marbod,
disappeared from the Wilson case. [To read a portion of the
secret
draft report, click here.]

Other
references that could have highlighted Barcellas conflicts of interest
in the October Surprise case also ended up on the cutting room floor.

For
instance, the alleged October Surprise roles of one Barcella client, the
scandal-plagued Bank of Credit and Commerce International, and his law
partner, Paul Laxalt, werent mentioned in the public report.

Barcella represented BCCI in the late 1980s as the Middle
Eastern-based bank was trying to frustrate press and government
investigations into its worldwide fraudulent activities, which included
money-laundering for drug traffickers and for intelligence operations.

Barcellas law firm  Laxalt, Washington, Perito & Dubuc  collected
$2.16 million in legal fees from BCCI from October 1988 to August 1990,
according to a Senate Foreign Relations Committee report on the BCCI
scandal. As part of his work for BCCI, Barcella tried to discourage
journalists who were sniffing out BCCIs secret ownership of First
American Bank in Washington.

BCCI
popped up on the October Surprise radar scopes through BCCIs dealings
with two key suspects, Iranian banker Cyrus Hashemi and Casey associate
John Shaheen. Shortly after Reagans Inauguration in 1981, the FBI
intercepted a message to Hashemi about BCCI delivering a payment from
London via the Concorde supersonic jetliner, a possible October Surprise
payoff that was not mentioned in the final task force report.

Laxalt,
the lead partner in Barcellas old law firm, also represented a
potential conflict of interest. The former U.S. senator
from Nevada was one of Reagans closest political allies and was
chairman of the 1980 Reagan-Bush campaign. The
Senate BCCI report said Barcella worked directly with Laxalt on the BCCI
account.

Barcella told me that he didnt believe that that work created
a conflict of interest for his participation in the October Surprise
case. But financial connections between alleged October Surprise
conspirators and Laxalt also were left out of the final report. [See
Parrys
Secrecy & Privilege.]

Backing Down

Almost
from the start of the October Surprise probe, Barcella didnt behave
like a hardheaded prosecutor determined to break through any obstacle or
ready to challenge possible cover stories from powerful politicians.

For
instance, when the Secret Service refused to fill in gaps in George H.W.
Bushs alibi for the weekend of Oct. 18-19, 1980  when some witnesses
claimed Bush had secretly traveled to Paris  Barcella agreed to a strange restriction on the evidence. He was
allowed to see the name of a supposed alibi witness but not to question
the person.

In other
words, possibly for the first time in investigative history, a suspect
(Bush) was allowed to supply the name of an alibi witness who supposedly
could vouch for his innocence but only if investigators didnt check out
the alibi or question the witness.

Later,
when Ronald Reagans lawyers balked at delivering documents from his
presidential library, Barcella protested but then quickly surrendered.
According to a letter that I found in the task forces unpublished
files, Barcella wrote to Reagans personal attorney Theodore Olson on
Sept. 22, 1992.

Your
letter indicates that the library was unable to locate and, therefore,
did not send, some of the documents requested by the Task Force staff,
Barcella wrote. In addition, some of the documents they did send do not
appear to correspond to the request noted on the list of requested
documents, e.g. the date, title or number of pages do not correspond.

But then
Barcella added, Although we are disappointed that we have not received
every document we tabbed for copying, time constraints do not permit us
to pursue this issue further at this time. Barcella was giving up on
a document request with more than three months to go in the
investigation.

Trap
Door

Still,
even as the task force pressed ahead toward its debunking of the
October Surprise charges, new evidence kept intruding, causing concern
that the exculpatory findings might not stand up to history.

Barcella
ordered his deputies to put some language in, as a trap door in case
later disclosures disproved parts of the report or if complaints arose
about selective omission of evidence.

This
report does not and could not reflect every single lead that was
investigated, every single phone call that was made, every single
contact that was established, Barcella suggested as trap door
wording in a memo dated Dec. 8, 1992. Similarly, the Task Force did not
resolve every single one of the scores of curiosities, coincidences,
sub-allegations or question marks that have been raised over the years
and become part of the October Surprise story. [To see the trap door
memo, click here.]

But some of the information that arrived during the investigations
final month would deal not just with curiosities, but with central
questions of the mystery.

Former
Iranian President Abolhassan Bani-Sadr sent a detailed account of the
internal Iranian struggle over how to react to the Republican hostage
overtures. David Andelman, a biographer of French intelligence chief
Alexandre deMarenches, testified that deMarenches had admitted to
arranging secret meetings in Paris between Republicans and Iranians.

Former
CIA officer Charles Cogan testified that he recalled a conversation in
Caseys office in 1981  after Reagans campaign chief became CIA
director  when there was a reference to having done something to
interfere with Carters October Surprise. [To see the context for
Cogan's secret
testimony, click here. To
read part of Cogan's
testimony, click
here.]

Finally,
there was the Russian report, which asserted that both President Carter
and the Reagan-Bush campaign were negotiating with Iran in 1980. [For
more on the Russian report, click here.]

Nevertheless, Barcella put the finishing touches on the report clearing
the Reagan-Bush campaign. He often seemed more intent on burying the
October Surprise suspicions than engaging in a rational debate about the
evidence.

Blocked Dissent

When
Rep. Mervyn Dymally, a Democratic member of the task force, tried to
lodge a dissent against some of the absurd alibis that the task force
had used to supposedly establish Caseys whereabouts, Barcella fiercely
opposed Dymallys reservations.

In
reviewing the task force report, Dymally's staff aide, Marwan Burgan,
had detected obvious flaws in the reports logic, including the claim
that because someone wrote down Caseys home phone number on one day
that proved Casey was home, or that because a plane flew from San
Francisco directly to London on another important date that Casey must
have been onboard.

According to sources who saw Dymallys dissent, it argued that just
because phones ring and planes fly doesnt mean that someone is there to
answer the phone or is on the plane. But Barcella enlisted Hamilton to
pressure Dymally into withdrawing the dissent.

Dymally,
who was retiring in 1993, told me that the day his dissent was
submitted, he received a call from Hamilton warning him that if the
dissent was not withdrawn, I will have to come down hard on you.

The next
day, Hamilton, who was becoming chairman of the House International
Affairs Committee, fired the staff of the Africa subcommittee that Dymally had headed. The firings were billed as
routine, and Hamilton told me that the two things came along at the same time,
but they were not connected in my mind.

Hamilton said his warning to Dymally referred to a toughly worded
response that Hamilton would have fired off at Dymally if the dissent had stood.
Hoping to salvage the jobs of some of his staff, Dymally agreed to
withdraw the dissent.

So the
House Task Forces report was shipped off to the printers with its
conclusion that there was no credible evidence of Republican
double-dealing with Iran over the 52 American hostages in 1980.

Now,
however, with more documentary evidence undermining that conclusion and
Barcellas legal reputation under challenge from former CIA officer
Wilson, the October Surprise conventional wisdom  that it was just
some nutty conspiracy theory  seems shakier than ever.

Robert Parry broke many of the Iran-Contra
stories in the 1980s for the Associated Press and Newsweek. His new book, Secrecy & Privilege: Rise of the Bush Dynasty from
Watergate to Iraq, can be ordered at
secrecyandprivilege.com. It's also available at
Amazon.com, as is his 1999 book, Lost History: Contras, Cocaine,
the Press & 'Project Truth.'